Aeropostale (ARO) Q3 Profit Tumbles 52% But Beats Street Expectations
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Financial Fact:
Basic earnings per share: -0.16
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Financial Fact:
Basic earnings per share: -0.16
Today's EPS Names:
BTTX, VAXX, ELYS, More
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Aeropostale, Inc. (NYSE: ARO) Wednesday afternoon posted results for the third quarter ended October 29, 2011. Following the release, shares of Aeropostale are trading down nearly 1 percent.
The company reported sales fell 1 percent year over year to $596.5 million as same-store sales decreased 9 percent for the quarter. Despite the decline, Aeropostale topped the Street’s consensus of $581.5 million in total sales. E-commerce sales rose 19 percent to $45.7 million.
The cost of sales for the quarter totaled $434.99 million, or 73 percent of net sales, up from only accounting for 63.4 percent of total sales during the third quarter of 2010.
Net income accounted for 4 percent of total sales and fell 59 percent year over year to $24.1 million. Income from operations made up 6.7 percent of total sales and fell 59 percent to $39.73 million
Diluted net earnings were $0.30 per diluted share, $0.02 per share above the Street’s consensus, but $0.33 per share below last year’s earnings for the same quarter.
The retailer ended the quarter with cash and cash equivalents of $109.4 million, and no debt.
Aeropostale has $145.2 million still available under its share repurchase program.
For the fourth quarter, management offered earnings guidance of $0.35 to $0.38 per share, well below the $0.44 per share that the Street is forecasting.
Thomas P. Johnson, Chief Executive Officer, commented, "We are making incremental progress on our strategic initiatives by bringing more color and fashion to our merchandise assortment, managing our inventories appropriately and controlling our expenses carefully. However, we are not satisfied with our overall performance, and we remain cautious in our outlook. The retail environment remains incredibly promotional with many teen retailers increasing both the depth and breadth of their promotions. Additionally, unemployment remains high and there is continued uncertainty about the overall economic environment. Near-term we are focused on executing our holiday initiatives and long-term we remain committed to improving our financial performance as well as investing in future growth."
The company reported sales fell 1 percent year over year to $596.5 million as same-store sales decreased 9 percent for the quarter. Despite the decline, Aeropostale topped the Street’s consensus of $581.5 million in total sales. E-commerce sales rose 19 percent to $45.7 million.
The cost of sales for the quarter totaled $434.99 million, or 73 percent of net sales, up from only accounting for 63.4 percent of total sales during the third quarter of 2010.
Net income accounted for 4 percent of total sales and fell 59 percent year over year to $24.1 million. Income from operations made up 6.7 percent of total sales and fell 59 percent to $39.73 million
Diluted net earnings were $0.30 per diluted share, $0.02 per share above the Street’s consensus, but $0.33 per share below last year’s earnings for the same quarter.
The retailer ended the quarter with cash and cash equivalents of $109.4 million, and no debt.
Aeropostale has $145.2 million still available under its share repurchase program.
For the fourth quarter, management offered earnings guidance of $0.35 to $0.38 per share, well below the $0.44 per share that the Street is forecasting.
Thomas P. Johnson, Chief Executive Officer, commented, "We are making incremental progress on our strategic initiatives by bringing more color and fashion to our merchandise assortment, managing our inventories appropriately and controlling our expenses carefully. However, we are not satisfied with our overall performance, and we remain cautious in our outlook. The retail environment remains incredibly promotional with many teen retailers increasing both the depth and breadth of their promotions. Additionally, unemployment remains high and there is continued uncertainty about the overall economic environment. Near-term we are focused on executing our holiday initiatives and long-term we remain committed to improving our financial performance as well as investing in future growth."
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